Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/297578 
Year of Publication: 
2021
Citation: 
[Journal:] Contemporary Economics [ISSN:] 2300-8814 [Volume:] 15 [Issue:] 4 [Year:] 2021 [Pages:] 375-392
Publisher: 
University of Finance and Management in Warsaw, Faculty of Management and Finance, Warsaw
Abstract: 
This paper contributes to the literature on the effects of uncertainty on household saving - a long-standing and extensively explored topic yet leaving a number of issues inconclusive. It concentrates on the labor income uncertainty by addressing saving against unemployment risk in terms of changes in credit supply and households' financial wealth. Time series analysis uses dataset of quarterly observations from 2003 Q4 to 2019 Q3 for Poland. It provides empirical evidence of the negative relationship of changes in households' financial wealth and credit availability with the household propensity to save, in line with the buffer saving model. Furthermore, it contributes to the discussion on the choice of uncertainty measures referring to the labor market with a recommendation to employ the subjective (perceived) unemployment expectation index rather than the objective unemployment rate. These results are meaningful for policy implications. They emphasize the role of credit availability for household consumption/saving decisions. In case of expansionary monetary policy and making credit easier to acquire for households, all other things equal, a negative effect on the household saving rate may be expected. This poses a question about the risk of households' overreliance on credit and therefore about their financial stability in emergency situations.
Subjects: 
Credit
household saving
unemployment risk
uncertainty
Poland
JEL: 
E21
E24
G51
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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